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Thursday, 14 October 2010

Sinn Fein has produced proposals for dealing with the cuts (pdf file). Once you wade past the All-Ireland guff, in terms of principles there are a number of very interesting shifts that probably provide more basis for advancement than the individual ideas. They have accepted the principle of cutting down on government (assembly costs and quangos but not departments). They have accepted in principle a pay freeze (but limited it to higher earners). They have accepted in principle asset sales. They are also seem to imply an acceptance of cuts coming (if trying to dissipate it).

In terms of practicalities of their proposals, additional tax powers being an answer is dubious. If the powers are to be used to "generate income" then they will have to rise (significantly) undermining their ability to then "stimulate development".

In terms of savings the RPA claims don't stack up. Curbing consultants in government is already underway. In terms of revenues the phone mast tax would most likely be passed on in increased costs to consumers and businesses or if it succeeded in getting companies to share masts then it would achieve less revenue than predicted. (UPDATE Chekov highlights another issue about this). The plastic bag tax may have some possibilites. However, by my back of envelope calculations, it'd raise only £5-6 million a year so it represents loose change. As for the environmental issues, shops have been making some headway on reducing their use without a tax involved. They specifically rule out water charges or removing any rate reliefs which would include the property value cap at £400,000.

A number of the proposals are essentially means of the Executive borrowing money itself but Treasury rules will almost certainly block this (unless of course the body is privatised). They have an interesting suggestion how asset realisation could release cash now but avoids selling at the bottom of the market. However any relaxation of the rules is unlikely considering that central policy is to reduce the national debt not increase it by rebranding it as belonging to different parts of the nation. The expectation of generosity from the four main banks is heartwarming but I wouldn't be relying on getting £400m out of them any time soon. You'd be lucky to get a cup of coffee out of them.

There are two proposals as regards European money. The Regional Innovation Strategy set a target of 50m euros from the 7th framework over the 07-13 period. So a target of 100m euros in the next couple of years is extremely ambitious. As for the JEREMIE and JESSICA programmes this largely falls under the domain of DSD with the rumour that it hasn't been pulling its weight as regards trying to access these (so perhaps a little bit of intra-nationalist politics at play there).

As to the Green New Deal being an answer that all depends on your belief or otherwise in the underlying premise and the value for money represented by the public subvention involved.

Overall has it really found £1.9 billion of the potentially £2bn hole? Nope, not even close but it still represents a step towards the harsh realities we will face after 20th October.

PS I don't know how many times they used the phrase all-Ireland (they annoyingly disabled the word search function on the document). After counting 14 references I got fed up and stopped counting.